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2. On Dec 31, 2022, Pipsqueak Company decides to acquire the ASSETS of Squeaky Toy Company. On that date Squeaky Toy Company had the following
2. On Dec 31, 2022, Pipsqueak Company decides to acquire the ASSETS of Squeaky Toy Company. On that date Squeaky Toy Company had the following balances: BOOK Value Fair Market Value $125,000 $625,000 $350,000 Current Assets Building Accum Dep-B Equipment Accum dep Current Liabilities Bonds Payable Com Stock PIC R/E $135,000 $450,000 ($150,000) $360,000 ($50,000) ($100,000) ($200,000) ($50,000) ($100,000) ($295,000) ($100,000) ($175,000) During 2022, Squeaky Toy Company earned a profit of $250,000. The seller's industry expects a Return on Investment of 8%. Required: a. Calculate the price if Squeaky Toy Company asks for 5 years of excess earnings. b. Record the purchase of the company on the books of Pipsqueak Record the sale on the books of Squeaky Toy. c
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